Value analysis is a systematic process to reduce costs without compromising quality or function. It was developed after WWII at GE to address shortages by finding substitutes. Value analysis identifies unnecessary costs and improves value through functions analysis. The process involves decomposing products and identifying alternate ways to achieve the main function at a lower cost. Value analysis has provided major cost savings for many leading companies. It focuses on customer needs and removes non-value adding functions or costs.
1: Value Analysis provides great turnaround in the operations of the businesses.
2: Use Value Analysis to analyze and understand the detail of cost for specific situations.
3: Use it to find a focus on key areas for innovation.
4: Use it in reverse (called Value Engineering) to identify specific solutions to detail problems.
Value Analysis (VA) is a tool (technique or method) that is used for improving the value of a product or a process of understanding its constituent components and their associated costs. It aims at finding improvements to the components by reducing their cost and increasing the value of the functions of a product or a service.
A critical advantage to using a VA is its potential for reducing costs, which is a benefit that permeates all advantages of the system.
A VA breaks-down a product or service into components, it enables you to analyze each component on its own, evaluating its features and functions in detail efficiency and effectiveness.
1: Value Analysis provides great turnaround in the operations of the businesses.
2: Use Value Analysis to analyze and understand the detail of cost for specific situations.
3: Use it to find a focus on key areas for innovation.
4: Use it in reverse (called Value Engineering) to identify specific solutions to detail problems.
Value Analysis (VA) is a tool (technique or method) that is used for improving the value of a product or a process of understanding its constituent components and their associated costs. It aims at finding improvements to the components by reducing their cost and increasing the value of the functions of a product or a service.
A critical advantage to using a VA is its potential for reducing costs, which is a benefit that permeates all advantages of the system.
A VA breaks-down a product or service into components, it enables you to analyze each component on its own, evaluating its features and functions in detail efficiency and effectiveness.
A Study Report on Value Analysis and Value Engineering (VAVE)Avijeet Suryavanshi
This Project Report presents the basic fundamental of value engineering that can be implemented in any product to optimize its value. A case study of L&T Technology Services is discussed in
which the material, design of components is changed according to the value engineering methodology. In the present case study, it is observed that the unnecessary increase in cost is due
to the use of expensive material, increase in variety of items and thereby increasing the inventory and so on. Therefore, selected some components and applied value engineering technique for the cost reduction of these components.
Value Engineering is an effective tool in identifying areas where cost reduction can be achieved.
In order to effectively do this, various approaches in specific areas of focus are discussed in this report.
What is quality and quality improvement, what is cost reduction, types of problems (sporadic and chronic), need of quality improvement and cost reduction
In this presentation, we will discuss production planning system, factors determining production control procedure, role of production planning and control in operations management, scope of production planning and control, its phases and principles. We will also talk about framework for strategy formulations and task control, PPC limitations, effectiveness, PPC in different systems, requirement of an effective PPC in a system and make or buy analysis.
To know more about Welingkar School’s Distance Learning Program and courses offered, visit: http://www.welingkaronline.org/distance-learning/online-mba.html
A Study Report on Value Analysis and Value Engineering (VAVE)Avijeet Suryavanshi
This Project Report presents the basic fundamental of value engineering that can be implemented in any product to optimize its value. A case study of L&T Technology Services is discussed in
which the material, design of components is changed according to the value engineering methodology. In the present case study, it is observed that the unnecessary increase in cost is due
to the use of expensive material, increase in variety of items and thereby increasing the inventory and so on. Therefore, selected some components and applied value engineering technique for the cost reduction of these components.
Value Engineering is an effective tool in identifying areas where cost reduction can be achieved.
In order to effectively do this, various approaches in specific areas of focus are discussed in this report.
What is quality and quality improvement, what is cost reduction, types of problems (sporadic and chronic), need of quality improvement and cost reduction
In this presentation, we will discuss production planning system, factors determining production control procedure, role of production planning and control in operations management, scope of production planning and control, its phases and principles. We will also talk about framework for strategy formulations and task control, PPC limitations, effectiveness, PPC in different systems, requirement of an effective PPC in a system and make or buy analysis.
To know more about Welingkar School’s Distance Learning Program and courses offered, visit: http://www.welingkaronline.org/distance-learning/online-mba.html
This presentation is designed to give purchasing, materials, supply management, sourcing, contracting, logistics, acquisition and procurement personnel a process of value measurement to quantify the value of purchased goods or services. Learn how to use Value Analysis to target goods and services where cost can be reduced, performance improved, quality enhanced, non-essentials eliminated, downsized, or consolidated through a step-by-step process of value identification and measurement.
The genesis of value analysis and value engineering can be traced to similar, parallel developments in the late 1940’s taking place at General Electric Company and Ford Motor Company. As a concept definition: it is the organized and systematic effort and study directed at analyzing the functional requirements of the system, product, equipment, facility, service or project for the purpose of achieving the lowest overall total cost at the best value. This means consistent with the needed performance, reliability, quality, and maintainability.
Join the trend of many purchasing, sourcing, contracting, and supply management organizations who are reaping the rewards of Value Analysis (VA) and Value Engineering (VE) as a practical tool to improve performance and reduce the cost of goods and services. Their experience with cost reduction projects reveals that by merely determining what things cost and documenting cost breakdowns, one can reduce costs 5%. Improving the choice of material, conceptual design, and methods can further reduce cost by another 10%. Finally, developing a better way to perform what a project or a service was originally intended to do, one can save even more—20-30% and beyond!
Not convinced of the critical importance of value analysis/value engineering VA/VE--- then you must not be interested in product enhancement, service concept augmentation, cost reduction, and profit improvement. Those kinds of payoffs don’t come easily, however. Success depends on three things: understanding of the concept by those who will be involved, strong top management support, and enthusiastic team or project oriented direction to get and keep the program rolling.
No wonder that Purchasing magazine for years dedicated an annual issue to its “Value Analysis of the Year” Awards. Why? According to experts, VA/VE can make a difference: simple projects can take anywhere from one day to six weeks to implement with savings up to $2,000; intermediate projects can range from six weeks to six months with savings of $2,000 to $10,000; and complex projects can take six months to six years with savings ranging from $10,000 to $1 million.
Purchasing Management
Principles of Purchasing Management OR (8 R'S)
Functions of Purchasing Management
Negotiating
Value Engineering
VALUE ANALYSIS
Receive Purchase Request
Supplier selection
Payment Authorization
Market research and Information
Selection of Source
Determination of Price and Availability
Follow Up
Industry Analysis on Construction Industry.
1950 to mid 60’s- govt. Play an important role in development
Construction activities carried by state owned enterprises and supported by govt. Departments
First professional consultancy company – NIDC (1953)
Design engineering and construction companies were set up in the public sector
These six distinctions will help you raise the profile of procurement in your organization, and more importantly, give you the inspiration to deliver exceptional outcomes. Find out more at www.accenture.com/us-en/insight-procurement-six-distinctions.
In the dynamic landscape of construction and engineering in the USA, our Value Engineering and Value Analysis services stand as beacons of innovation and efficiency. We understand the unique needs of the industry and have tailored our services to deliver unparalleled value to your projects.
Our team of experts combines cutting-edge technology and AI tools with extensive engineering knowledge to provide comprehensive solutions. We meticulously scrutinize every aspect of your project to identify
Understanding User Needs and Satisfying ThemAggregage
https://www.productmanagementtoday.com/frs/26903918/understanding-user-needs-and-satisfying-them
We know we want to create products which our customers find to be valuable. Whether we label it as customer-centric or product-led depends on how long we've been doing product management. There are three challenges we face when doing this. The obvious challenge is figuring out what our users need; the non-obvious challenges are in creating a shared understanding of those needs and in sensing if what we're doing is meeting those needs.
In this webinar, we won't focus on the research methods for discovering user-needs. We will focus on synthesis of the needs we discover, communication and alignment tools, and how we operationalize addressing those needs.
Industry expert Scott Sehlhorst will:
• Introduce a taxonomy for user goals with real world examples
• Present the Onion Diagram, a tool for contextualizing task-level goals
• Illustrate how customer journey maps capture activity-level and task-level goals
• Demonstrate the best approach to selection and prioritization of user-goals to address
• Highlight the crucial benchmarks, observable changes, in ensuring fulfillment of customer needs
Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
In the Adani-Hindenburg case, what is SEBI investigating.pptxAdani case
Adani SEBI investigation revealed that the latter had sought information from five foreign jurisdictions concerning the holdings of the firm’s foreign portfolio investors (FPIs) in relation to the alleged violations of the MPS Regulations. Nevertheless, the economic interest of the twelve FPIs based in tax haven jurisdictions still needs to be determined. The Adani Group firms classed these FPIs as public shareholders. According to Hindenburg, FPIs were used to get around regulatory standards.
B2B payments are rapidly changing. Find out the 5 key questions you need to be asking yourself to be sure you are mastering B2B payments today. Learn more at www.BlueSnap.com.
Digital Transformation and IT Strategy Toolkit and TemplatesAurelien Domont, MBA
This Digital Transformation and IT Strategy Toolkit was created by ex-McKinsey, Deloitte and BCG Management Consultants, after more than 5,000 hours of work. It is considered the world's best & most comprehensive Digital Transformation and IT Strategy Toolkit. It includes all the Frameworks, Best Practices & Templates required to successfully undertake the Digital Transformation of your organization and define a robust IT Strategy.
Editable Toolkit to help you reuse our content: 700 Powerpoint slides | 35 Excel sheets | 84 minutes of Video training
This PowerPoint presentation is only a small preview of our Toolkits. For more details, visit www.domontconsulting.com
Event Report - SAP Sapphire 2024 Orlando - lots of innovation and old challengesHolger Mueller
Holger Mueller of Constellation Research shares his key takeaways from SAP's Sapphire confernece, held in Orlando, June 3rd till 5th 2024, in the Orange Convention Center.
Putting the SPARK into Virtual Training.pptxCynthia Clay
This 60-minute webinar, sponsored by Adobe, was delivered for the Training Mag Network. It explored the five elements of SPARK: Storytelling, Purpose, Action, Relationships, and Kudos. Knowing how to tell a well-structured story is key to building long-term memory. Stating a clear purpose that doesn't take away from the discovery learning process is critical. Ensuring that people move from theory to practical application is imperative. Creating strong social learning is the key to commitment and engagement. Validating and affirming participants' comments is the way to create a positive learning environment.
LA HUG - Video Testimonials with Chynna Morgan - June 2024Lital Barkan
Have you ever heard that user-generated content or video testimonials can take your brand to the next level? We will explore how you can effectively use video testimonials to leverage and boost your sales, content strategy, and increase your CRM data.🤯
We will dig deeper into:
1. How to capture video testimonials that convert from your audience 🎥
2. How to leverage your testimonials to boost your sales 💲
3. How you can capture more CRM data to understand your audience better through video testimonials. 📊
Premium MEAN Stack Development Solutions for Modern BusinessesSynapseIndia
Stay ahead of the curve with our premium MEAN Stack Development Solutions. Our expert developers utilize MongoDB, Express.js, AngularJS, and Node.js to create modern and responsive web applications. Trust us for cutting-edge solutions that drive your business growth and success.
Know more: https://www.synapseindia.com/technology/mean-stack-development-company.html
VAT Registration Outlined In UAE: Benefits and Requirementsuae taxgpt
Vat Registration is a legal obligation for businesses meeting the threshold requirement, helping companies avoid fines and ramifications. Contact now!
https://viralsocialtrends.com/vat-registration-outlined-in-uae/
3. Origin
• Value Analysis was developed after WW-II in USA
at General Electric (GE) in 1947. Because of WW-
II, there were shortages of skilled labor, raw
materials, and component parts at GE.
• Lawrence D. Miles, Jerry Leftow, and Harry
Erlicher at GE looked for acceptable substitutes.
They noticed that these substitutions often
reduced costs, improved product, or both. This led
them to the discovery of a systematic process for
cost reduction without compromising on the
desired quality of products. They named their
process as “VALUE ANALYSIS”.
5. DEFINITION
Value Analysis can be defined as,A process of
systematic review that is applied to existing product
designs in order to compare the function of the product
required by a customer to meet their requirements at
the lowest cost consistent with the specified
performance and reliability needed.
A systematic analysis that identifies and selects the best
value alternatives for designs, materials, processes,
and systems. It proceeds by repeatedly asking, "Can
the cost of an object be reduced or eliminated, without
diminishing the effectiveness, required quality,
customer satisfaction or market acceptability?”
6. Techniques of Value Analysis and Engineering
tells you why so much unnecessary cost exists in
everything we do. . . how to identify, clarify, and
separate costs which bear no relationship to
customers' needs or desires. . . how to place a
dollars-and-cents value on different customer
functions. . . how to divide a problem into "mind-
sized" steps, each one of which is solvable and
the sum of which solves the major problem.
7. Value: The ratio between a function for customer
satisfaction and the cost of that function. It is the least
cost that can achieve reliably a function or a service.
Value of a product = Performance of the function /
Cost
Need: Something that is necessary or desired by a
customer
Function: The effect produced by a product or by one
of its elements, in order to satisfy customer needs.
Value Analysis: A systematic process that is used to
increase the value of an object that is achieved by
providing required functions of a product at lowest
overall cost consistent with achieving the required
quality, performance and market acceptance.
8. VA team refers to a team/group/committee of
cross-functional technicians who follow a stated
workplan to accomplish VA objectives.
The object can be a product, a system, a
process, a procedure, a plan, a machine,
equipment, tool , a service or a method of
working.
The aim of VE is to obtain target cost without
compromising on the quality of a product by:
Identifying improved product designs that
reduce product’s cost
Eliminating unnecessary functions that increase
the product’s costs
9. VE requires the use of Functional Analysis (FA).
FA is an analysis of the relationships between
product functions, their perceived value to the
customer and their cost of provision. The process
involves decomposing the product into its many
elements or attributes.
For instance, in the case of automobiles,
functions might be consist of style, comfort,
operability, reliability, quality and attractiveness
etc., etc.
10. What is it? (a pencil)
What is it used for? (writing and making marks)
What is the main function of this product? (making marks, writing)
What is the method, material or procedure that was used to realize
the main function? (a graphite stick & wood)
What are the corresponding secondary functions? (transfer graphite
to paper and facilitate holding the graphite)
What does the item cost and how can we distribute the cost of
realizing the main function into each secondary function?
Comparing these costs to an item of a similar function, how much
should each function cost and what must be the total cost?
Important Note
Focus your VA on the main function, because, during the analysis, the
secondary functions may change. The group/committee/team may
choose different secondary functions to realize the main function.
11. For many of the world’s leading companies, including
names like Hewlett Packard, Sony, Panasonic, Toyota,
Nissan, and Ford, VA process of design review has
provided major business returns.
The key to realizing these returns is through using
knowledge of:
the customer requirements,
the costs of the product,
manufacturing process &
the costs associated with failures due to poor or
inadequate product design.
All these inputs to VA process are vital if decisions
regarding product and process re-design are to yield lower
costs and enhanced customer value.
12. Functions may be broken down into a hierarchy,
starting with a basic or main function, for which the
customer believes they are paying, and then followed
by secondary functions, which support that basic
function.
For example, a coat may have a use function of
making you warm (i.e. basic or main function) and an
aesthetic function of ‘looking smart, attractive and
charming’.
13. SIX “ WHATs OF VALUE ANALYSIS “
1) What is it ?
2) What does it do ?
3) What does it cost ?
4) What is it worth ?
5) What else will do the job ?
6) What does that cost ?
14. THE PHASES OF VALUE ANALYSIS
SELECTION & ORIENTATION
ANALYSIS
RECORDING IDEAS
SPECULATION
INVESTIGATION
RECOMMENDATION
IMPLEMENTATION
15. # Stage Description
1.
SELECTION &
ORIENTATION
To select those critical areas where a potential for cost reductions is
expected.
Use the common Pareto’s ABC analysis.
General scope, restrictions and aims of the study is defined.
2. ANALYSIS
Examine the data at a VA group/team meeting.
Record the minutes of each brainstorming session.
Apply the Tests for Value.
Propose further action.
3.
RECORDING
IDEAS
Write down the minutes of analyses meetings and circulate them to
group/team members for further queries.
It includes the agenda for the next meeting.
4.
INNOVATION/CR
EATIVITY
Arrange team meetings in order to discuss the ideas analyzed and
any new information obtained.
Think upon practical measures for reducing costs and increasing
value.
16. # Stage Description
5. EVALUATION
Investigate suggestions for reducing costs and to make them
practical and acceptable to client management.
Obtain definite prices and costs in order to estimate cost
reductions accurately.
6. RECOMMENDATIONS
Recommend cost reductions to client management.
Present the recommendations in a comprehensive report.
Recommend a member to act as an implementation consultant for
VA recommendations.
7.
IMPLEMENTATION&
MONITORING
Implement the recommendations accepted by the company
management. Monitor the results as suggested in VA report.
Jot down the feedback of the management upon completion of VA
assignment.
17. 1. A high customer orientation, focusing on those aspects of the
product/service that better satisfy customer needs.
2. Allows enormous cost reductions by eliminating functions that do
not satisfy customer requirements/needs.
3. VA improves profitability of products.
4. New ideas that arise from the creativity/innovation phase, may
add radical changes.
5. VA provides a process to systematically improve the existing
goods and services. It builds value into a product or service.
6. VA process is used to offer a higher performing product or
service to a customer at a minimal cost.
18. 8. VA process is, therefore, one of the key features of a
business that understands and seeks to achieve
TQM in all that it does to satisfy customers.
9. VA process often allows to root out practices that
have grown out of date and can be replaced with
more modern approaches.
10.VA can uncover design flaws that not only operate
inefficiently but also create problems. In the case of
a product, this could mean a high rate of
malfunctioning items, creating customer complaints
and warranty claims that put a strain on personnel
and inventory departments.
19. Avoid making generalizations and superficial statements –
it is important to be precise at every moment.
Collect, determine and examine all costs involved – only
when one is cost conscious, will it be possible to determine
the value of the thing being assessed.
Make use of information from the best possible sources.
It is possible that two different VA consultants may give
different sets of recommendations still both be correct.
There can be challenges in the selection of the best
alternatives.
20. APPLICATION OF VALUE ANALYSIS
1. Capital goods – plant, equipment, machinery, tools,
etc.
2. Raw and semi-processed material, including fuel.
3. Materials handling and transportation costs.
4. Purchased parts, components, sub-assemblies, etc.
5. Maintenance, repairs, and operational items.
6. Finishing items such as paints, oils, varnishes, etc.
7. Packing materials and packaging.
8. Printing and Stationery items.
9. Miscellaneous items of regular consumptions.
10. Power, water supply, air, steam & other utilities
(services).